Mitchell posts record sales tax revenue for Q1 of '12

If sales tax receipts are any measure, the economy must be rebounding. Or is it all about an unusually warm winter? Mitchell posted the best first quarter sales tax figures in city history, Finance Officer Marilyn Wilson told the Mitchell City Co...

If sales tax receipts are any measure, the economy must be rebounding. Or is it all about an unusually warm winter? Mitchell posted the best first quarter sales tax figures in city history, Finance Officer Marilyn Wilson told the Mitchell City Council on Monday night at City Hall. The figures showed totals going back to 1995. The city made $2,286,329.14 from its 2 percent sales tax from January through March this year, according to Wilson.

During the same three months in 2011, the city made $1,996,182.80. That means there was a 14.54 percent increase this year compared to the same time last year. Part of the gain was from a late sales tax payment of $85,728 from the state Department of Revenue and Regulation, Wilson said, but the city would have topped the 2011 total without that.

The 2012 receipts topped the all-time high for the first quarter, set in 2009, when the city took in $2,053,575.32.

January also set a record, with $793,577.82 in receipts, topping the record set in 2009 by almost $90,000.

February was also a record month, with $898,911.72 in receipts, breaking the record set in 2007 by more than $70,000.


"I think that has something to do with the weather we had," said Councilman Dan Allen. "They weren't staying inside."

The mild winter lured people out of their homes, Allen said, and they went to restaurants and elsewhere to spend money.

"This is encouraging," Councilman Jeff Smith said.

There was a decline in March, however, as the collected $693,839.60. That's less than was brought in during March 2011, 2010 and 2009.

But the city's third-penny, or entertainment tax, also set a record. That tax applies only to alcohol, lodging and prepared food.

The city brought in $125,969.05 in the first quarter, besting the 2011 total of $118,695, and besting the previous high of $120,615.39, set in 2010.

"So far, for the first quarter, we're looking good," Wilson said. "Hope it holds up."

Improving signage at intersections


The council will consider improved signage on three streets it has proposed be changed from one-way traffic to two-way traffic.

A decision on the future of Second, Third and Fourth avenues will be made in the June 5 municipal election. Smith said better signs should be considered to improve safety.

"Either way it goes, as far as the vote, we need to look at improved signage," he said.

Smith and Public Safety Chief Lyndon Overweg offered a brief proposal for new signs and additional painting at busy intersections. The council voted to place it on the Traffic Commission agenda for the May 21 meeting. Smith said he wants the city to "hit the ground running after the election."

Councilman Marty Barington said he welcomed the new information and thinks it will benefit the community to have the discussion.

"I think it's well advised to send this back to the Traffic Commission," Barington said.

New TIF approved, city bonding capacity debated

The council approved Resolution 2985, tax increment financing district 17, by a 6-2 vote after a debate on how the city should allocate its resources and use its debt.


The city Planning and Zoning Commission and the city TIF Committee both recommended approval of the project. The TIF's highest possible cost would be $768,256, counting capital interest, payable over a 20-year period. It would be used to extend city streets in The Woods subdivision.

Chuck Mauszycki Sr. is developing the property and his son Chuck Mauszycki Jr. is selling the lots.

Mitchell lawyer Don Petersen spoke in favor of the proposal and said it would provide much-needed affordable housing. It also has a small commercial portion.

"This isn't only a win for the developer, which it is, it can also be a win for the business community," Petersen said.

Councilman Greg McCurry said he wondered why the TIF was needed since there are 32 empty lots at The Woods now. Why not fill them in first, he asked. Also, it might lower the value of houses already in the city, McCurry said.

McCurry said he also hears from his constituents who have noticed all the empty lots in the city and wonder why new developments are being started when there is available land for housing. It's something he wonders himself, he said.

Petersen said adding the lots will lower costs and assist both the developer and buyers.

Allen said not all the available land in the lots are for affordable housing.


Smith said he was told by a local contractor that if the TIF is approved, the contract would start building houses there. If the TIF is not approved, the company may look to another community, he said.

Councilman Mel Olson wondered why the TIF needed approval right now. Perhaps the city should wait to decide how much it wants to invest in the Corn Palace, since there is a debt ceiling that might be reached if the city continues to add TIFs, Olson said.

He said 40 percent of the city's debt is now in TIFs and the city needs to avoid "nickel-and-diming" its bonding capacity away. Olson said a satellite fire station, improving the Corn Palace and other projects should have a higher priority.

"I'm not against this," he said. "But I'm against it tonight."

McCurry also voted against it.

Smith said the council needs to determine how much money it has to invest in the Corn Palace and other projects. That will be at the center of its discussions at next week's special meeting, he said. Olson said he wanted to have that meeting before approving the TIF.

"Why can't it wait a meeting or two?" he asked. "I just don't understand what the hurry is to do it tonight."

Councilman Ken Tracy said he doubted any long-term decisions on the Corn Palace or a new fire station will be made in the next several weeks, while the developer wants to move now with a housing shortage evident and a growing demand for houses.


Petersen said the developer may not move ahead with the project if there is a delay. He said adding affordable housing can be as much of a benefit to the city as an improved Corn Palace.

"They are not mutually exclusive," Petersen said. "I think they could be done at the same time."

Mayor Lou Sebert said TIFs have been a good investment for the city. Sebert said he studied the current TIFS and was convinced they have improved the city's valuation, provided jobs and helped people looking for housing.

A TIF is used to provide financing for infrastructure such as streets in a defined area. As the area develops, the new taxes created by the development are captured to pay off the infrastructure improvements. After the improvements are fully paid off, the taxes go to local taxing entities such as the city.

Other business

In other agenda items, the council:

  • Approved a contract with the Puetz Corp. for architectural, mechanical and electrical services for City Hall office remodeling at the Mitchell Technical Institute North Campus site.

The city is considering moving out of City Hall and converting that space into tourist attractions to enhance the attached Corn Palace. The MTI location has been suggested as a possible new home for City Hall.
Tracy said the City Hall Relocation Committee has sought proposals for the project and three local architectural firms submitted offers. The committee chose Puetz, he said.

The cost is between $5,000 and $7,000 for a study of the MTI building and, possibly, a rendering for the proposed remodel. The city had budgeted $15,000 for studies, and other sites may be studied, Tracy said.


Allen twice said he wants to try to keep City Hall in downtown.

Tracy said some downtown sites were studied but "they didn't work out." It also was determined that converting the city library to City Hall was not a good option, he said.

McCurry, who also sits on the committee, said no good downtown options have yet been found. Parking is a major concern, he said. But McCurry said the committee will continue to look at its options.

The contract was approved by a 7-1 vote, with Allen opposed.

  • Held the first reading of Ordinance 2403, calling for drainage and storm sewer plans for subdivisions to be submitted to and approved by the public works director. If given final approval, the plans would have to adhere to the topography of the area.

This was once in the city's ordinances, Public Work Director Tim McGannon said, but was somehow dropped over the years, most likely in error.

  • Held the first reading of Ordinance 2404, supplemental appropriations of $48,000 for playground equipment at Cadwell Park, with half from the Parks, Recreation and Forestry Department cash balance and half from a donation from the Mitchell men's softball association.

The softball players want additional playground equipment at the park for kids to use while teams are playing games. Olson wondered if the city should send a note of thanks or buy them a case of beer.
"Perhaps both," Sebert said.

Parks Director Dusty Rodiek said the city does recognize and thank donors for such gifts.

The ordinance will also send $15,000 to the Convention and Visitors Bureau, $15,000 in a transfer to the Corn Palace, $5,000 to the Mitchell Area Development Corp. and $2,500 to a regional marketing effort. Those dollars will come from entertainment sales tax revenues.

Wilson said the money comes from higher-than-projected sales tax revenue.

"I budget the amount we anticipate will come in for the year," Wilson said.

She receives the final 2011 sales tax payments in January, which is already past the time to supplement these accounts for that year, she said. So, Wilson said, she distributes the money the places where the sales tax dollars are allocated.

"They get the percentage that's in the ordinance," she said.

The ordinance also calls for $10,000 for Lawler water utilities from the Water Fund cash balance and $1,000 for water and sewer at the Mitchell Public Library, with the money coming from the general fund. The library's bill for 2011 exceeded the budgeted amount.

  • Authorized the Mitchell Fire Division to apply for a $2,000 grant from Walmart for smoke detectors.

No income levels will be set, and any person or business that asks for them may have one or more.

  • Tabled a decision on awarding a bid for the Sanborn Street concrete panels, phase II, project 2012-22, for two weeks. Public Works Deputy Director Terry Johnson said the bids were over the budgeted amount.
  • Awarded a bid for a dump truck chassis, project 2012-32, to Westman Freightliner, of Marshall, Minn., which submitted the lowest of four bids at $82,949. Most of the cost will come from an insurance payment after a city dump truck caught on fire while plowing this winter.
  • Approved the application of the Palace City Lions Club for a special event malt beverage and wine license at the Horseman's Sports Arena July 19-22 for the Corn Palace Stampede Rodeo.
  • Approved Resolution 2986, the plat of Spruce Acres Tract A.
  • Approved Resolution 2987, quit claim deeds of Gary E. and Gloria A. Oldenberg, Jason L. Stoebner and Chad E. Larson.
  • Approved an abatement of taxes in the amount of $307.90 to city of Mitchell legally described as the west 942.2 feet of the southwest quarter north of Railroad since it was purchased by a tax-exempt entity.
  • Sat as the Board of Adjustment and:

Set a May 21 date for a hearing on the application of Brad Ciavarella for a conditional use permit to construct apartment housing at 410 W. Second Ave., the old Whittier Elementary School.
Set a May 21 date for a hearing on the application of Glen Vilhauer for variances for side yard setback to match existing garage, a back yard setback from the alley, and an oversized garage at 1105 W. Sixth Ave. The request is being made because the side yard, back yard setbacks and height limitations are not being met.

Set a May 21 date for a hearing on the application of Jerry and Pam Thomsen for variances for a roadside setback to construct a detached garage, and for a future attached garage at 214 N. Harmon Drive. The request is being made because the roadside, side yard setbacks and height limitations are not being met.

Set a May 21 date for a hearing on the application of Ron and Linda Parks for variances to construct a detached garage at 313 Milan Ave. The request was made because the side yard and back yard setbacks are not being met.

Held a hearing on and approved the application of Doug Krantz for a conditional use permit to sell and display trailers and vehicles at 1501 W Spruce. The city Planning and Zoning Commission had recommended approval.

Held a hearing on and approved the application of Jerry Bertsch for a variance to construct a garage at 316 W. 13th Ave. The request was made because the building height standard will not be met. The planners recommended approval.

Held a hearing on and approved the application of Tim and Sherry Hines for a variance to construct an addition at 605 W. 14th Ave. The request was made because the front yard setback will not be met. The planners had recommended approval.

  • Heard from James Tegethoff, who complained about nuisance enforcement.

Tegethoff said he registered a complaint on July 20 about a drainage ditch by Parts World and Pro Build. It wasn't until March 5 that Parts World was asked to clean up, although code enforcement officer Jeff Lanning disputed that after the meeting.
Tegethoff said he was issued a complaint on March 17 about a garage he owns on rental property that needs work. He said he has worked on the house, cleaned the lawn and cut trees in an effort to improve the property, which he bought a few months before the citation. The garage was next on his agenda, he said.

Lanning gave him a month to improve the garage, Tegethoff said. He said he called Councilman Ken Tracy and was then given a second month. But he said that wasn't enough time, since his carpenter was unable to schedule the work.

"I think the city needs to clean up their own problems before they ask others," he said.

  • McCurry and Smith said anonymous letters do not receive much consideration from the council.

The city's elected officials have been receiving a few unsigned letters recently, they said. At least one contained photos of property in poor condition, claiming they were city property. Councilman Travis Carpenter said several of the properties in the photos do not belong to the city.
"If you're not proud enough to put your name on it, it doesn't have a lot of worth," Smith said.

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